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Wednesday, 12 November 2014

What could be more appropriate, for a European Kat who is away in the Antipodes, than for him to post this guest item on Community trade mark law from a genuine Aussie who is now back in his native terrain after a stint in London? The Aussie in question is Bill Ladas of King & Wood Mallesons, an enthusiastic contributor to that firm's IP Whiteboard blog and about whom it is boldly stated that "it’s a miracle he gets any “work” done at all". Not sure what to make of that ...This is what Bill writes:

Does the treatment of toy mark CTMs reveal a split between OHIM’s Fourth
and Fifth Boards of Appeal?

I have recently discussed whether objections against stylised device marks
containing descriptive words should be raised under Articles 7(1)(b) and/or (c)
of the Community Trade Mark Regulation. Next question: does it matter
which Board of Appeal hears your case when it comes to the distinctiveness
inquiry under Article 7(1)(b)? Some recent decisions relating to the treatment
of 2D and 3D marks for toys, suggest that there might be a split between the
Fourth and Fifth Boards. Or are the
decisions reconcilable on their particular facts?

Rejected! (Cases R2129 through 2134/2013-5)

Out Fit 7 Limited might have thought that it was on relatively safe
ground in terms of its filings for various cute 3D marks (listed below in
respect of goods in class 28), including action figure toys. It owns CTM
registrations consisting of these same characters in 2D or “figurative” form.

The examiner threw a cat among the pigeons (or parrots?), raising
objections under Article 7(1)(b) on the basis that the marks lacked distinctive
character. Out Fit 7 appealed.

In each case, the Fifth Board upheld the examiner’s view, based on
established principles:

(i) consumers are not in the habit of
making assumptions about the origin of products on the basis of their shape in
the absence of any graphic or word element;

(ii) the more closely the shape for which
registration is sought resembles the shape most likely to be taken by the
product in question, the greater the likelihood of the shape being devoid of
any distinctive character; and

(iii) the sign needs to depart
significantly from the norm.

Taking Talking Angela as an example, the Fifth Board took the
view that it resembled other white cats (white being a colour “girls tend to
like”), adding that the head was bigger than that of a normal cat and that it
was also standing on its hind legs. Even so, while this marked a departure from
the norm, it was not a significant enough departure.

But the Fifth Board went further:

“… the
toy cat figure is not expected to appear on the toy market on its own. It is
noted that toys are not usually sold without their producer’s trade marks,
since parents would be reluctant to buy toys of unknown origin, even if the
appearance of those toys would be pleasant to look at. Since toys are usually
advertised and sold under a brand name, the argument that the consumers base
their choice on the shape is not persuasive. The shape modelled from the App
character, ‘Talking Angela’ will most likely appear together with the name
badge that will help the consumer to make its choice.”

Acquired distinctiveness under Article 7(3) did not assist. Out Fit 7
relied on use and advertising of its characters in apps under the Talking
Angela, Talking Tom marks etc and the evidence did not demonstrate use in
respect of the applied-for goods (“acquired
distinctiveness of a sign achieved in relation to certain goods cannot be
automatically transferred from one class of goods to another”). Vorsprung
Durch Technik[noted by the IPKat here]
was distinguished.

Contrast unlucky Out Fit 7 with the treatment received by Tattiemoon and
The Fred Rogers Company. These decisions are well worth a read, given how rare
it is for OHIM’s Boards of Appeal to overturn an absolute grounds objection.
What is also notable is how differently the matter was approached by the Fourth
Board as compared to the Fifth.

Fred Rogers

The Fred Rogers Company filed CTM applications for 2D representations of
its popular characters:

The examiner raised objections under Article 7(1)(b) that the signs did
not differ markedly from various basic shapes commonly used in the trade. The
Fourth Board disagreed. Taking the cat-like sign (as a handy comparison with
Talking Angela and as it mentions a cat), it had this to say as regards
goods in class 28:

“The
sign shows a stylised and humanised representation of a little cat in upright
position wearing a dress, sports shoes, socks and a hair ribbon at the left
ear. It is far removed from any naturalistic or stylised representation of a
little cat and will be recognized by consumers as referring to a specific,
fanciful character. The sign shows the type of character featuring in comics,
children’s books and animated movies that one would expect to have a specific
name in contrast to, for example, plush toy or toy figurines that consist in the
naturalistic representations of a cat.”

In respect of the other goods in classes 21, 24 and 25 the objection was
also overturned:

“Consumers
of any age are accustomed to a variety of fanciful characters featuring in
comics and animated movies that represent animals or persons but deviate
substantially from a naturalistic or standardised representation such as Micky
Mouse, Goofy, Pooh the Bear [presumably a reference to Winnie the Pooh], Lucky Luke,
Ernie and Bert etc. Even when used for decorative purposes these characters are
recognized as distinctive and hence capable of indicating a commercial origin”.

For completeness, Fred Rogers also has other 2D cases on appeal
according to OHIM’s website.

“Woolly”, another cute 2D mark,
was accepted by the Fourth Board as being distinctive. Summarily overturning
the reasoning of the examiner, the Board said:

“The
sign applied for is a fanciful representation of an eight-legged, coloured
animal with a human like, smiling face. It is neither the common representation
of the goods at stake nor the true representation of an existing animal but
rather an inventive creation with its own characteristics. The special
features, namely the combination of eight legs, colours and the particular
features of the body, create the individual image of this plush toy. The
combination of these features allows it to serve as a business identifier not
only for plush toys, but also for the other goods applied for.”

The Fourth Board continued, with reasoning that seems to conflict
directly with the reasoning of the Fifth Board in the Out Fit 7 cases:

“Even
if the sign is used in a form that represents the shape and appearance of the
goods at stake, it will be perceived as an indication of origin. Moreover, the
file does not contain any information that the goods at stake are currently
marketed or might be marketed in the future by affixing the sign at stake to an
item having the shape of the trade mark applied for. In any case, the sign is
distinctive.”

What a mess: but who is right?

Is the difference in result here due only to the fact that the Out Fit 7
marks are 3D in nature, while the Tattiemoon and Fred Rogers marks are in 2D?
This would appear to be a strange result (and goes against eg Case
T-152/07 Lange Uren v OHIM). It also appears harsh for the
Fifth Board to reject a trade mark application for a 3D mark on absolute
grounds because:

(a) the product itself is likely to be sold with labelling (in this highly
regulated world, not many products are sold without labelling);

(b) the product is referred to, advertised and sold under a brand name (how
else are we supposed to talk about it or ask for it in the shops);

(c) (in the case of Talking Angela) it is not wearing a dress … or sports
shoes. [It is accepted here that some of Out Fit 7’s marks are closer to “the
norm” than others.]

This is even more so, given that the Fourth Board accepted that the
fact that the product is likely to be given a name was a factor in favour
of registrability.

The view of the Fifth Board appears to go against market reality.
Several marks can be used at the same time in respect of the same product (the
recent Coke v Pepsi decision in New Zealand, notedhere, being a case in point).

And do we really need to make a case that in 2014 the shape of a product
can on its own be recognized or relied on as a brand (we should know from the
CJEU soon whether the former is enough to satisfy the acquired distinctiveness
proviso[see my note on the Kit Kat shape mark here]. Perhaps there is a fear (at
least on the part of the Fifth Board) regarding the scope of rights that
will accrue to the owner of such a registered mark. Given the track record of
the CJEU and the General Court in enforcement cases (eg as regards stylised
marks incorporating descriptive words), the fears are probably well founded.
We also saw earlier this year that the word mark BETTY BOOP was infringed
by images of Betty Boop in England and Wales[see Katnotes on the Hearst decision here
and here,
and our note here].

A
concept is not a sign capable of being
protected by registration as a trade mark. The rights conferred by registration are centred on the registered
representation of the protected mark. They do not enable the concept(s) of a
mark to be protected without regard to the distinctive character of the mark as
registered.

In the meantime, subject to how your toy mark is used, you may be on
safer ground applying for it in 2D format (subject to novelty requirements,
there is also the option of protecting the toy as a Community registered
design).

What about Australia and New Zealand?

My recent note on the battle to save the Kit Kat shape mark (here) discussed the leading
Australian decision, Kenman Kandy. That decision involved the
Millennium Bug shape (right). Similarly to the Out Fit 7 scenario,
the 2D version of the bug was accepted as being inherently distinctive during
examination but the 3D mark was not. It took two appeals, through to the Full
Federal Court, for the 3D mark to achieve acceptance (on the basis of its
inherent qualities; the applicant did not rely on acquired distinctiveness).

However, more recent comments from a differently constituted Full
Federal Court in Cantarella (relating to another issue at the
margins, foreign equivalents) have cast doubt on the majority’s approach
in Kenman Kandy. Cantarella has been appealed and we wait to see
whether and how the High Court’s decision has repercussions in relation to
shape marks. There’s also the fascinating world of trade mark infringement
actions based on non-verbal marks, which we discussed in the context of
Coca-Cola’s suit against Pepsico in New Zealand (here) based on its bottle marks.

What is clear from all of these decisions (and also see my note
on BPI’s fragrance bottle in the UK here) is that the registries and
courts have a difficult time in drawing lines between the registrable and
unregistrable, which will inevitably lead to inconsistent results.

1 comment:

I am puzzled why these were not rejected under Art 7(1)(e)(i) or (iii)? Surely it is the shape of these goods that is giving them much of their value (and that the applicant is trying to monopolise).

These are classic cases of 3D product designs, for which Reg Des protection is ideal, being touted as trade marks to try to get a longer period of protection. Use of Art 7(1)(b), rather than Art 7(1)(e) which is designed for the case, strikes me as a lazy bit of examining, especially since Art 7(1)(e) would have excluded Art 7(3)

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